We would have come across various insurance policies that are designed to protect our property or us. There are insurance policies to cover the risk involved for us, for our vehicles and our property. Any mishap or accident cannot be stopped but we do all we can to protect our properties and vehicles so that the risk involved can be minimized. When our property or goods get damaged in fire accident, there is a huge financial loss and it's not possible to compensate for it immediately. This is when we are in need of insurance policies as only they can cover the risk to some extent. Just as these policies are very important to minimize or cover the financial loss that might occur in the event of death, accident, fire accident etc, even liability insurance is a must for a professional.

How many professionals such as doctors, lawyers or accountants think about the risk involved in their profession when they provide service or treatment to their clients or patients daily? Nowadays, it is become mandatory for professionals to buy liability insurance so that when they are sued for malpractice and if the claim made comes within the insurance policy coverage, the risk can be transferred to the insurer. The insurance company does not pay directly to the insured; rather it compensates the loss incurred by a third party due to the negligence or misrepresentation of the professional involved. The professional should be aware of the policy limits before he decides to purchase. Since the defense costs are skyrocketing, professionals should make sure that is comes as a part of the coverage.

Insurance policies like auto insurance costs more when compared to liability insurance. In auto insurance, the vehicle of both the insured as well as the other party is covered unlike liability insurance, which covers the loss incurred by a client or patient who sued a professional for negligence. This does not protect the professional or his property. The insurance company will handle the legal expenses (if specified in the insurance contract that this will be covered along with the policy) and compensate the party who has incurred loss in the form of damages or injuries. This will help in minimizing the risk involved in the profession. Based on the severity of the profession, the coverage amount and premium varies.

Legal fees and compensation given to a third party are expensive. If a professional has not taken liability insurance to protect his profession and when a lawsuit is filed against him, his reputation will be at a stake and even his personal assets will be at a risk. On the other hand, if his profession is well protected by proper insurance coverage, then the risk gets transferred to the insurance company from where he has bought liability insurance. Thus if a professional hesitates to buy a policy to protect his profession due to the huge cost involved then later on he will lose even his personal assets along with his reputation.